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Dave Jackley
Hi there, welcome to another edition of Exactly At Home North of Pittsburgh. And today I have the pleasure of speaking with:
Sean Curran
Sean Curran from American Financial Mortgage.
Dave Jackley
So tune in to find out how to navigate the current financial money borrowing situation so you can get into your next home.
So, Sean, I think first and foremost on everybody’s mind right now is the change in mortgage rates from a couple years ago. What would you say to people as they navigate through the current situation, and it’s time for them to buy a house today?
Sean Curran
Well, I would say right now we are fraught with uncertainty. And what I’m telling people who are asking me, “Is it a good time to buy now?”, it really depends on the individual circumstance. If you are in need of a house right now, whether it be work growing family, it is a good time to buy since finally the housing prices are slowing down. I just read over the weekend that the the price of homes has actually gone down by 0.7%. This does not seem like a lot, but considering that’s the first time in three years,when what was going on with prices going up 40% over that three years. That’s signals a good time to buy. Now I know that people are at all concerned about the interest rates are approaching 6%. Yes, it is approaching 6%, but historically that is a “normal” range. However, there are things that you can do. Moving ahead, you can plan on the possibility of refinancing in the next five to seven years. Or you could do what’s called an adjustable rate mortgage, which is a lower interest rate right now, the adjustable rate mortgage rate is 4.75. And that’s for seven years. So that will that will adjust after seven years. Now what you’re hoping for in a situation like that is that you’re either going to move or you’re going to be able to refinance. That is the ultimate goal with an adjustable rate mortgage because you don’t want to incur the adjustable rate, which would probably be somewhere in the neighborhood approaching 8%.
Dave Jackley
Interesting. Well, so there’s an option for people. And I know you have lots of programs. So Sean, tell me about what makes American Financial stand out from other firms in the area?
Unknown Speaker
Great question. First of all, American Financial Mortgage has been serving this community for 33 years, we are one of the area’s largest Mortgage Bankers. And what I mean by Bankers is a lot of times people think of Broker. Well, there’s a big difference between a Broker and a Banker. A Broker takes all your information and they send it to the investor. Those are the people that they’re going to sell the loan to. At American Financial, we fund the loan in our own name because we are a banker. That means we’re underwriting the loan in house, and we’re utilizing our pool of appraisers. There’s two big advantages to that. The fact that we’re underwriting in house, we’re still utilizing common sense underwriting what seems to have left this business a long time ago. And then the advantage of utilizing appraisers from our own pool since 2010, when the Dodd Frank Act came on, they made mortgage companies adhere to appraisal management companies. Before that, appraisers were simply chosen by the mortgage company and there was there was a lot of shakiness in doing so. So it kind of went from the Wild West to now. Because now with the appraisal management companies, you are sometimes getting an appraiser from an area who is not familiar with the the area that he’s appraising in. For example, you may have an appraiser who’s up in the North Hills coming over to the South Hills, an area that they’re not they’re not familiar with. With us, we’re picking our appraisers from the areas in which they’re that they are familiar with. Another advantage is we are a very small company in regards to employees. So we have very little overhead and we are a lot we are able to pass that on in with the rates that we offer. I’d like to say that we have some of the lowest rates in the industry. And we have lots of various programs that we offer right now we have a physician’s loan that is at 4.5% and 0% down payment and zero mortgage insurance That’s absolutely phenomenal. We also have a Jumbo Loan Program that is also for 4.5%. And if you have a qualifying credit score, you can put 15% down and still have no mortgage insurance. And then we’ve worked with the PHFA, the state bond program. And what’s awesome about that is, if we’re dealing with, say, a first time homebuyer that doesn’t have a lot of liquid assets, closing funds, we have a program with them, that gives you 5% of the purchase price towards your closing costs. So if you’re able to, excuse me, if you’re able to utilize that with sellers assist, I’ve had people who have come to the close with $1,000.
Dave Jackley
Wow, that’s an absolutely wonderful program. Because buyers need to plan that they’re going to have the right amount of money in the bank when they go to closing, which is another thing on which we’ve counseled people.
Sean Curran
And it’s so important for buyers to touch base with a mortgage professional, sometimes before they even contact a realtor. Because, as you know, a lot of these people will come to you and you ask them if they have a pre-approval, and they don’t, and you can’t really put an offer in, so you’re spinning your wheels. So I always recommend that these people talk to a mortgage professional first, we can pull their credit, we can check their financials, we can print plan properly for them. So when they’re putting in an offer, and the other agent is aware that this is a solid offer. That’s really important.
Dave Jackley
Solid offers are so important right now. And I like what you said about appraisals, because, you know, I’ve represented buyers who are wringing their hands, will it appraise? Especially if they paid over list price in today’s market. Yes. And it’s great to have people who understand what’s going on in today’s market. Well, that’s fantastic. I’m glad to to learn about the subtle and important differences in your company. So people can make traditional full down payments of 20%. But you can save cash right to get into your house and do like 3%.
Sean Curran
Oh, yes, absolutely. And honestly, Dave, most people do not put 20% down. A lot of people put 5% or 10% down. And The reason being is the old adage is anybody who’s bought a home 20 years ago, they always advised their children put 20% down, because you want to avoid that mortgage insurance. However, about three years ago, they changed the formula on the conventional loans for the mortgage insurance. It used to be a set percentage, regardless of your credit score. However, now it’s based on your credit score. So if you have two borrowers with excellent credit–I just did this yesterday–putting 10% down on a $400,000 house, their mortgage insurance is $39 a month. And that’s been in effect for about five and a half years. So that’s just making the minimum payment.
Dave Jackley
Yes, that’s a no brainer. And yes, it saves all that cash that you may need to fix up the house, and to support also what you’re saying. Again, this is just in my own personal experience, I don’t really have a lot of data. The one piece of data I have is the National Association of REALTORS said that a new high of 22% of houses reduced their prices in the last month or so. And it used to be that nobody reduced their price. And the other thing, again, from my personal experiences, there are what I call the gem houses that are perfectly cared for, move-in ready and so forth. And then there’s still a lot of buyers out there. And there still may be some competition to take it above list price. But I think a lot of houses like you say are goiing at list or slightly below. And you know, if the average is 0.7% below list, there are as many homes that go for 3% above list price then there’s about that same number gonna go for 3% below list price.
Sean Curran
What I’m seeing just in the last month or two is that they’re not competing against 12 other borrowers right at this point. So you may go in at two or three, a lot of a lot of my current clients right now are putting in offers at listing or slightly above listing, which was which was not the case just six months ago. People were looking at a $475,000 house put in an offer and for 515 and losing that offer.
Dave Jackley
Believe me, the stories all of us Realtors like tell each other about. You want to be the one that had the house that got the 10 offers over list or whatever, but it does happen. And in fact, it happened in my neighborhood recently. It was pretty outstanding. And what’s interesting is the house sold over list of the very first buyer so they had invisible competition as far as I can tell. Well, how did you get in to this business and what do you like about it?
Sean Curran
Well, it’s easy for me to tell you when I got into this business because it all started, right around the time my daughter was born, who just turned 16. I was working as an executive recruiter for accountants and financial planners. I have a financial background, I have an accounting business business degree. And when my daughter was born, I was working eight o’clock in the morning, till five o’clock in the in the afternoon. And I had some friends that were in the mortgage business, and I wanted to maybe get away from that corporate environment and give myself more time freedom. But when you’re working 60 hours a week, it’s not necessarily freedom. But, as you know, we work a lot in the evenings and on the weekends. In this way, I could take my daughter to appointments, and spend time with my daughter in the day when my wife went back to work, my wife worked with children, six months to two years, and she would did a lot of did a lot of in home visits. So this gave me the opportunity to stay home with my daughter, and do some work on the phone. I did go into the office. But as I said, a lot of work was over the phone. And it gave me the opportunity to have some time with my daughter and some free time.
Dave Jackley
I see that as well. And especially the pandemic has accelerated the process of people working remotely.
Sean Curran
Many clients have the ability to work from home, and they’re buying houses in Butler or Beaver County in the country. The only problem they have sometimes experienced, and I advise my clients to do this before they buy their home is to make sure you have good Wi Fi up there. Because one client bought a house up in Beaver and his Wi Fi was horrible.
Dave Jackley
Well, yeah, it’s funny, I think in in the towards the end of 2021, of the fastest growing real estate markets in the country was Boise, Idaho, and it was people from the West Coast getting out to the country. And unfortunately, a lot of those really hot markets have receded a little bit. But you know, we’re lucky here in Pittsburgh. It’s pretty stable. I don’t think it’ll ever go completely backwards. it’s slow, but continuous growth.
Sean Curran
I always say that that’s one of the best parts about here, you know, to 2008, the collapse, nothing really happened. I was living in a more extreme state at that time. Nothing really happened here in that regards, because the prices were not overinflated. You had a lot of these interest-only loans that were being sold in Florida and California. And the thing about the interest-only loan was the pitch would be as long as your house doesn’t depreciate, you’ll be fine for the next two years. What happened? Everybody’s making these interest-only payments, and their houses depreciated. drastically. But that did not happen here in Pittsburgh, because they were not the home prices were not over inflated.
Dave Jackley
Wow. That’s interesting. So I imagine you’ve had a lot of interesting experience with clients does anything pop into your mind when you think about interesting experiences?
Sean Curran
I think about every time I’m watching a football game, I had a borrower several years ago, who was a member of the Pittsburgh Steelers. And if you recall several years ago, remember they had a work stoppage. So he wanted to buy a house during this work stoppage. And in the mortgage industry, whether you’re making $2 million a year or $2,000 a year, you have to be working when you purchase, the house. And for them at that time, because they were on strike. And then not only that, he was in the last year of his contract. So he did not have what we’d called continuous employment, because we didn’t know what was going to happen for him after the next year and that he was trying to do a conventional mortgage this whole time. There are other avenues that he could explore which I believe that he did. But during the work stoppage, he pulled up to our office with a $300,000 Lamborghini and tried to offer that as collateral!
Dave Jackley
Wow, that’s so interesting. Well as the story goes, don’t sign the dotted line on your mortgage and then go out and buy a new car and change your whole financial situation. Especially a Lamborghini! Well, what do you like most about this area? I mean, you work all over Pittsburgh, while I focus on the North Hills, Cranberry, Franklin Park, the North Hills of Pittsburgh area. What do you like most about Pittsburgh, and just this as a as a place to do business?
Sean Curran
Well, first of all, affordability of the houses, as we just mentioned. ,During the 2008. Crash, the house market maintained here. And there’s still great value here. I just read over the weekend, the median price of a house in the United States is $465,000. Oh, my goodness. I mean, we’ve lived here, you know what you can get for $465,000, you get a pretty nice house for $465,000. So the affordability of the houses here is wonderful. And then in regards to the people, I’m not I don’t want to sound cliche, but it’s salt of the earth people here at Pittsburgh. It’s hard-working people, and you have to gain their trust. And if you gain the people’s trust, you have a client for life. I’ve set my whole model up on being having people being able to trust me and tell their friends and their families about because it’s all about for me, it’s growth. It’s building referrals.
Dave Jackley
Yes, trust and relationships. And if you’re new to Pittsburgh, take note of that. And I think you’ll find out as you live here, and I’m a Pittsburgher that lived away for a few years and circled back. And I don’t think I’d go anywhere else.
Sean Curran
I did the same thing. And we’ve done to Ohio for 10 years. And the grass is not always greener.
Dave Jackley
Yes. That’s interesting. What do you do outside of work? Do you have any favorite pastimes?
Sean Curran
Well, right now, as I mentioned, I have a 16 year old daughter, so I kind of live vicariously through her. She is involved in so many things. I joke with my friends. And I say that I’m an unpaid Uber driver, meaning that I go pick up my daughter, and she tells me where I’m taking her next. I don’t get compensated for that. What I like to do is a hobby of mine. Basically my whole life I have collected vintage toys, vintage NFL college football memorabilia, and LPs. Now, I have LPS from when I was a child, but I’ve really taken that out as a passion. Lately, going around getting LPs. And like with the vintage toys, these were toys that I grew up with. And as I’m circling around I’m reliving my childhood now. And buying toys and collecting toys from from the 70s It’s funny in my downstairs, I have Charlie’s Angels, dolls next to NFL dolls–really!?
Dave Jackley
Well, Sean, I want to thank you so much for taking the time today, sharing information about mortgages. If you want to learn more, you need to get in touch with Sean and find out how you can walk through the front door of your next house today or tomorrow, no matter what the circumstances are. So tune in again next time for another edition of Exactly At Home North of Pittsburgh. We’ll see you then.
SUMMARY KEYWORDS
people, house, pittsburgh, buy, work stoppage, offer, appraisers, years, mortgage, borrowers, daughter, loan, mortgage insurance, home, Sean Curran, business, area, price, today, clients, pre-approval
